Morales et al v. Unilever United States, Inc.

Filing 63

MEMORANDUM and ORDER GRANTING MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT signed by Senior Judge William B. Shubb on 7/11/2016: The Final Fairness Hearing is set for 10/17/2016 at 01:30 PM in Courtroom 5 (WBS) before Senior Judge Will iam B. Shubb, to determine whether the settlement agreement should be finally approved as fair, reasonable, and adequate. The following are the certain associated dates in this settlement: (a) The claims administrator shall publish notice pursuant to the notice plan by 8/11/2016; (b) Class members shall file objections, requests for exclusion, and claim forms by 9/19/2016; (c) Plaintiffs shall file a motion for attorney's fees no later than 9/12/2016. The parties shall file briefs in support of the final approval of the settlement no later than 9/12/2016. [See document for further details.] (Kirksey Smith, K)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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----oo0oo----

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ALBA MORALES; LANIE COHEN;
LINDA CLAYMAN; and KENNETH
DREW, on behalf of themselves
and all others similarly
situated,

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MEMORANDUM AND ORDER RE: MOTION
FOR PRELIMINARY APPROVAL OF
CLASS ACTION SETTLEMENT

Plaintiffs,

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CIV. NO. 2:13-2213 WBS EFB

v.
CONOPCO, INC., d/b/a
UNILEVER,

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Defendant.

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----oo0oo----

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Plaintiffs Alba Morales, Lanie Cohen, Linda Clayman,

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and Kenneth Drew brought this putative class action against

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defendant Conopco, Inc., d/b/a Unilever, asserting claims arising

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out of defendant’s alleged labeling of certain hair care products

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as “TRESemmé Naturals” despite them containing synthetic

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ingredients.

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for preliminary approval of the class action settlement.

Presently before the court is plaintiffs’ motion

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(Docket

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No. 57.)

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I. Factual and Procedural Background

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Defendant is a multinational consumer goods company

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whose products include food, beverages, cleaning agents, and

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personal care products, including the TRESemmé brand.

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Plaintiffs contend that defendant violated California’s

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Unfair Competition Law (“UCL”), Cal. Bus. & Prof. Code § 17200 et

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seq., California’s Consumer Legal Remedies Act (“CLRA”), Cal.

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Civ. Code § 1750 et seq., and various other state consumer

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protection laws.

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No. 30).)

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before reaching a settlement agreement on February 5, 2016 before

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mediator Jonathan Marks.

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Agreement”) ¶¶ 3-10 (Docket No. 57-2).)

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(See Second Amended Complaint (“SAC”) (Docket

The parties litigated the case for nearly two years

(Stipulation of Settlement (“Settlement

Plaintiffs brought this lawsuit on behalf of a putative

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class of consumers in the United States who have purchased

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TRESemmé Naturals products.

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preliminary approval of the parties’ stipulated class-wide

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settlement, pursuant to Federal Rule of Civil Procedure 23(e).

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(Id. at 4.)

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II. Discussion

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(Id. at 2-3.)

Plaintiffs now seek

Rule 23(e) provides that “[t]he claims, issues, or

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defenses of a certified class may be settled . . . only with the

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court’s approval.”

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involves a two-step process in which the Court first determines

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whether a proposed class action settlement deserves preliminary

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approval and then, after notice is given to class members,

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whether final approval is warranted.”

Fed. R. Civ. P. 23(e).

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“Approval under 23(e)

Nat’l Rural Telecomms.

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Coop. v. DIRECTV, Inc., 221 F.R.D. 523, 525 (C.D. Cal. 2004)

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(citing Manual for Complex Litig., Third, § 30.41 (1995)).

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This Order is the first step in that process and

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analyzes only whether the proposed class action settlement

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deserves preliminary approval.

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Co., 266 F.R.D. 468, 473 (E.D. Cal. 2010).

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authorizes the parties to give notice to putative class members

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of the settlement agreement and lays the groundwork for a future

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fairness hearing, at which the court will hear objections to (1)

See Murillo v. Pac. Gas & Elec.
Preliminary approval

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the treatment of this litigation as a class action and (2) the

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terms of the settlement.

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Pac. Islands, 876 F.2d 1401, 1408 (9th Cir. 1989) (stating that a

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district court’s obligation when considering dismissal or

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compromise of a class action includes holding a hearing to

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“inquire into the terms and circumstances of any dismissal or

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compromise to ensure that it is not collusive or prejudicial”).

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The court will reach a final determination as to whether the

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parties should be allowed to settle the class action on their

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proposed terms after that hearing.

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See id.; Diaz v. Trust Territory of

The Ninth Circuit has declared a strong judicial policy

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favoring settlement of class actions.

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of Seattle, 955 F.2d 1268, 1276 (9th Cir. 1992).

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where, as here, “the parties reach a settlement agreement prior

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to class certification, courts must peruse the proposed

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compromise to ratify both [1] the propriety of the certification

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and [2] the fairness of the settlement.”

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327 F.3d 938, 952 (9th Cir. 2003).

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Class Plaintiffs v. City
Nevertheless,

Staton v. Boeing Co.,

The first part of this inquiry requires the court to
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“pay ‘undiluted, even heightened, attention’ to class

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certification requirements” because, unlike in a fully litigated

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class action suit, the court “will lack the opportunity . . . to

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adjust the class, informed by the proceedings as they unfold.”

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Amchem Prods. Inc. v. Windsor, 521 U.S. 591, 620 (1997); see

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Hanlon v. Chrysler Corp., 150 F.3d 1011, 1019 (9th Cir. 1998).

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The parties cannot “agree to certify a class that clearly leaves

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any one requirement unfulfilled,” and consequently the court

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cannot blindly rely on the fact that the parties have stipulated

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that a class exists for purposes of settlement.

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U.S. at 621-22 (stating that courts cannot fail to apply the

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requirements of Rule 23(a) and (b)).

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See Windsor, 521

The second part of this inquiry obliges the court to

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“carefully consider ‘whether a proposed settlement is

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fundamentally fair, adequate, and reasonable,’ recognizing that

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‘[i]t is the settlement taken as a whole, rather than the

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individual component parts, that must be examined for overall

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fairness . . . .’”

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F.3d at 1026); see also Fed. R. Civ. P. 23(e) (outlining class

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action settlement procedures).

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Staton, 327 F.3d at 952 (quoting Hanlon, 150

A. Class Certification
A class action will be certified only if it meets the

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four prerequisites identified in Rule 23(a) and additionally fits

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within one of the three subdivisions of Rule 23(b).

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P. 23(a)-(b).

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determining whether the moving party has satisfied each Rule 23

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requirement, the court must conduct a rigorous inquiry before

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certifying a class.

Fed. R. Civ.

Although a district court has discretion in

See Califano v. Yamasaki, 442 U.S. 682, 701
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(1979); Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 161 (1982).

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1. Rule 23(a) Requirements

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Rule 23(a) restricts class actions to cases where:
(1) the class is so numerous that joinder of all
members is impracticable; (2) there are questions of
law or fact common to the class; (3) the claims or
defenses of the representative parties are typical of
the claims or defenses of the class; and (4) the
representative parties will fairly and adequately
protect the interests of the class.

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Fed. R. Civ. P. 23(a).

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referred to as numerosity, commonality, typicality, and adequacy

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These requirements are more commonly

of representation.

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a. Numerosity

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Under the first requirement, “[a] proposed class of at

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least forty members presumptively satisfies the numerosity

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requirement.”

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456 (C.D. Cal. 2012); see also, e.g., Collins v. Cargill Meat

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Solutions Corp., 274 F.R.D. 294, 300 (E.D. Cal. 2011) (Wanger,

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J.) (“Courts have routinely found the numerosity requirement

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satisfied when the class comprises 40 or more members.”).

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plaintiffs estimate that the proposed class will contain

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thousands of members because thousands of people purchased

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TRESemmé Naturals products.

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1).)

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Avilez v. Pinkerton Gov’t Servs., 286 F.R.D. 450,

Here,

(Kindall Decl. ¶ 21 (Docket No. 57-

This easily satisfies the numerosity requirement.
b. Commonality
Commonality requires that the class members’ claims

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“depend upon a common contention” that is “capable of classwide

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resolution--which means that determination of its truth or

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falsity will resolve an issue that is central to the validity of

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each one of the claims in one stroke.”
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Wal-Mart Stores, Inc. v.

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Dukes, 131 S. Ct. 2541, 2550 (2011).

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and law need not be common to satisfy the rule,” and the

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“existence of shared legal issues with divergent factual

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predicates is sufficient, as is a common core of salient facts

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coupled with disparate legal remedies within the class.”

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150 F.3d at 1019.

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“[A]ll questions of fact

Hanlon,

The proposed class includes “all individuals in the

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United States who purchased the following TRESemmé Naturals

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products: (a) Nourishing Moisture Shampoo; (b) Nourishing

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Moisture Conditioner; (c) Radiant Volume Shampoo; (d) Radiant

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Volume Conditioner; (e) Vibrantly Smooth Shampoo; and (f)

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Vibrantly Smooth Conditioner” while they were still being sold.

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(Pls.’ Mot. for Prelim. Approval (“Pls.’ Mot.”) at 2, 18 (Docket

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No. 57).)

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like the named plaintiffs, that they purchased a Unilever product

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labeled “TRESemmé Naturals” that contained synthetic ingredients

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in violation of state consumer protection laws.

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common core of salient facts and legal contentions, the proposed

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class meets the commonality requirement.

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The class would be comprised of individuals alleging,

Due to the

c. Typicality
Typicality requires that named plaintiffs have claims

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“reasonably coextensive with those of absent class members,” but

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their claims do not have to be “substantially identical.”

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Hanlon, 150 F.3d at 1020.

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other members have the same or similar injury, whether the action

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is based on conduct which is not unique to the named plaintiffs,

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and whether other class members have been injured by the same

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course of conduct.”

The test for typicality “is whether

Hanon v. Dataproducts Corp., 976 F.2d 497,
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508 (9th Cir. 1992) (citation omitted).

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The putative class members allege a simple set of facts

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that is essentially identical to those alleged by the named

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plaintiffs.

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allegedly injured by paying a premium for the TRESemmé Naturals

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products over comparable products that are not represented to be

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natural.

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varying amounts of the products and therefore have claims for

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different amounts, the class members’ claims appear to be

Both the class members and the named plaintiffs were

(SAC ¶ 63.)

Although class members may have purchased

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reasonably coextensive with those of the named plaintiffs.

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Moreover, the differences in amounts purchased are taken into

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account by the settlement agreement’s “Plan of Allocation,” which

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allots payments based on the number of products each class member

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purchased.

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(Docket No. 57-2).)

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typicality requirement.

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(Settlement Agreement Ex. A, Plan of Allocation at 1
The proposed class therefore meets the

d. Adequacy of Representation

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To resolve the question of adequacy, the court must

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make two inquiries: “(1) do the named plaintiffs and their

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counsel have any conflicts of interest with other class members

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and (2) will the named plaintiffs and their counsel prosecute the

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action vigorously on behalf of the class?”

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1020.

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factors, including “the qualifications of counsel for the

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representatives, an absence of antagonism, a sharing of interests

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between representatives and absentees, and the unlikelihood that

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the suit is collusive.”

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390 (9th Cir. 1992).

Hanlon, 150 F.3d at

These questions involve consideration of a number of

Brown v. Ticor Title Ins., 982 F.2d 386,

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First, there do not appear to be any conflicts of

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interest.

The named plaintiffs’ interests are generally aligned

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with the putative class members.

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suffered a similar injury as the named plaintiffs, and the

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definition of the class is narrowly tailored and aligns with the

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named plaintiffs’ interests.

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(“[A] class representative must be part of the class and possess

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the same interest and suffer the same injury as the class

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members.”); Murillo, 266 F.R.D. at 476 (finding that an

The putative class members

See Windsor, 521 U.S. at 625–26

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appropriate class definition ensured that “the potential for

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conflicting interests will remain low while the likelihood of

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shared interests remains high”).

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In this case, the settlement agreement provides a

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collective incentive award of up to $15,000 to the named

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plaintiffs, at the court’s discretion.

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¶ 60.)

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possibility that the named plaintiffs’ interest in receiving that

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award will cause their interests to diverge from the class’s

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interest in a fair settlement, the Ninth Circuit has specifically

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approved the award of “reasonable incentive payments.”

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327 F.3d at 977–78.

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carefully the awards so that they do not undermine the adequacy

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of the class representatives.”

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Inc., 715 F.3d 1157, 1163 (9th Cir. 2013).

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(Settlement Agreement

While the provision of an incentive award raises the

Staton,

The court, however, must “scrutinize

Radcliffe v. Experian Info. Sys.,

Courts have generally found that $5,000 incentive

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payments are reasonable.

Hopson v. Hanesbrands Inc., Civ. No.

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08-0844 EDL, 2009 WL 928133, at *10 (N.D. Cal. Apr. 3, 2009)

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(citing In re Mego Fin. Corp. Sec. Litig., 213 F.3d 454, 463 (9th
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Cir. 2000); In re SmithKline Beckman Corp., 751 F. Supp. 525, 535

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(E.D. Pa. 1990); Alberto v. GMRI, Inc., 252 F.R.D. 652, 669 (E.D.

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Cal. 2008).

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named plaintiff and are to be paid separate and apart from the

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settlement fund.

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per bottle of TRESemmé Naturals per class member is $5.

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(Settlement Agreement Ex. A, Plan of Allocation at 1.)

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members may recover for the purchase of up to ten bottles per

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household without providing proof of purchase and can recover for

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more than ten bottles if they submit adequate proof of a greater

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number of purchases along with their claim forms.

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the incentive award is relatively high in comparison to class

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recovery, it is well below the $5,000 benchmark and does not

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appear on its face to create a conflict of interest given that it

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does not detract from the settlement fund.

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court preliminarily finds that the proposed incentive awards do

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not render plaintiffs inadequate representatives of the class.

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Here, the incentive awards average $3,750 to each

(Settlement Agreement ¶ 60.)

The max recovery

(Id.)

Class

While

Accordingly, the

The second prong of the adequacy inquiry examines the

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vigor with which the named plaintiffs and their counsel have

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pursued the common claims.

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standards by which ‘vigor’ can be assayed, considerations include

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competency of counsel and, in the context of a settlement-only

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class, an assessment of the rationale for not pursuing further

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litigation.”

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“Although there are no fixed

Hanlon, 150 F.3d at 1021.

Plaintiffs’ counsel Mark Kindall and his colleagues at

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Izard, Kindall & Raabe, LLP have significant experience with

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litigating class action suits and have been appointed as lead

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counsel or co-counsel in over sixty class actions.
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(See Pls.’

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Mot. Ex. 3, Firm Resume of Izard, Kindall & Raabe, LLP (“Izard

2

Resume”) at 1 (Docket No. 57-4).)

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Bramson, Plutzik, Mahler & Birkhaeuser, LLP is similarly

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experienced with class actions, having recovered hundreds of

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millions of dollars in class action settlements while serving as

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lead or co-counsel.

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Bramson, Plutzik, Mahler & Birkhaeuser, LLP (“Bramson Resume”) at

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1 (Docket No. 57-5).)

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plaintiffs’ attorneys are qualified to conduct the proposed

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11

Plaintiffs’ liaison counsel

(See Pls.’ Mot. Ex. 4, Firm Resume of

The court finds no reason to doubt that

litigation and assess the value of the settlement.
In addition, plaintiffs’ counsel seems to have

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seriously considered the risks of continued litigation in

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deciding to settle this action.

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litigated the case, filing and briefing numerous motions,

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engaging in extensive discovery, and participating in mediation.

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(Kindall Decl. ¶¶ 2-14.)

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informed about the strengths and weaknesses of this case when

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they decided to accept the terms of the mediator’s proposed

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settlement agreement.

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Both parties have aggressively

Plaintiffs’ counsel was therefore

(Pls.’ Mot. at 17.)

Accordingly, the court concludes that the absence of

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conflicts of interest and the vigor of counsel’s representation

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satisfy Rule 23(a)’s adequacy assessment for the purpose of

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preliminary approval.

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2. Rule 23(b)

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An action that meets all the prerequisites of Rule

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23(a) may be certified as a class action only if it also

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satisfies the requirements of one of the three subdivisions of

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Rule 23(b).

Leyva v. Medline Indus. Inc., 716 F.3d 510, 512 (9th
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Cir. 2013).

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which provides that a class action may be maintained only if (1)

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“the court finds that questions of law or fact common to class

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members predominate over questions affecting only individual

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members” and (2) “that a class action is superior to other

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available methods for fairly and efficiently adjudicating the

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controversy.”

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Plaintiffs seek certification under Rule 23(b)(3),

Fed. R. Civ. P. 23(b)(3).

“Because Rule 23(a)(3) already considers commonality,
the focus of the Rule 23(b)(3) predominance inquiry is on the

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balance between individual and common issues.”

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Gas & Elec. Co., 266 F.R.D. 468, 476 (E.D. Cal. 2010) (citing

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Hanlon, 150 F.3d at 1022); see also Windsor, 521 U.S. at 623

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(“The Rule 23(b)(3) predominance inquiry tests whether proposed

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classes are sufficiently cohesive to warrant adjudication by

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representation.”).

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Murillo v. Pac.

The class members’ contentions appear to be similar, if

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not identical.

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number of bottles of TRESemmé Naturals products purchased by

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class members, there is no indication that those variations are

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“sufficiently substantive to predominate over the shared claims.”

21

See id.

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law and fact predominate over the class members’ claims.

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Although there are differences in the total

Accordingly, the court finds that common questions of

Rule 23(b)(3) also sets forth four non-exhaustive

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factors to consider in determining whether “a class action is

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superior to other available methods for fairly and efficiently

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adjudicating the controversy”:

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(A) the class members’ interests in individually
controlling the prosecution or defense of separate
actions; (B) the extent and nature of any litigation
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2
3

concerning the controversy already begun by or against
class members; (C) the desirability or undesirability
of concentrating the litigation of the claims in the
particular forum; and (D) the likely difficulties in
managing a class action.

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Fed. R. Civ. P. 23(b) (3).

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to certification, making factors (C) and (D) inapplicable.

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Murillo, 266 F.R.D. at 477 (citing Windsor, 521 U.S. at 620).

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The parties settled this action prior
See

Here, class members likely have little interest in

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individually pursuing litigation.

Plaintiffs allege that they

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suffered injury based on paying a premium for “natural” products.

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(SAC ¶¶ 6-9.)

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dollars and the premium paid constituted only a small portion of

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the total cost of each product.

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result, the damages for each individual class member would be

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nominal compared to the costs of litigation.

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members could conceivably have an interest in individually

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controlling prosecution given that plaintiffs estimated the

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damages sustained by the class as a whole are approximately

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$12.65 million and the $3.25 million settlement fund is only 25%

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of this “best case” recovery amount, the costs and risks

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associated with pursuing litigation would likely outweigh

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recoverable damages for each individual class member.

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12, 18; Kindall Decl. ¶ 17.)

23

Defendant’s line of products only cost several

(Pls.’ Mot. at 12.)

As a

Even though class

(Id. at

The court is also unaware of any concurrent litigation

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already begun by class members regarding the TRESemmé Naturals

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products sold by defendant.

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hearing may reveal otherwise.

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At this stage, the class action device appears to be the superior

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method for adjudicating this controversy.

Objectors at the final fairness
See Alberto, 252 F.R.D. at 664.

12

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3. Rule 23(c)(2) Notice Requirements

2

If the court certifies a class under Rule 23(b)(3), it

3

“must direct to class members the best notice that is practicable

4

under the circumstances, including individual notice to all

5

members who can be identified through reasonable effort.”

6

R. Civ. P. 23(c)(2)(B).

7

content of a proposed notice.

8

651, 658 (N.D. Cal. 1997) (citing Eisen v. Carlisle & Jacquelin,

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417 U.S. 156, 172–77 (1974)).

Fed.

Rule 23(c)(2) governs both the form and
See Ravens v. Iftikar, 174 F.R.D.

Although that notice must be

10

“reasonably certain to inform the absent members of the plaintiff

11

class,” actual notice is not required.

12

1449, 1454 (9th Cir. 1994) (citation omitted).

13

Silber v. Mabon, 18 F.3d

The settlement agreement provides that KCC Class Action

14

Service LLC (“KCC”) will provide notice to the class and

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administer the claims process.

16

“KCC has successfully served as the notice and claim

17

administrator [in] a number of other consumer class action

18

settlements where it has employed similar notice plans.”

19

Mot. at 15.)

20

purchased its products, KCC used class demographics to develop a

21

notice plan that it estimates will reach over 70% of the class

22

members.

23

Notice Plan at 10 (Docket. No. 57-2).)

24

banner advertisements on websites that class members are likely

25

to visit, an advertisement in People magazine for one week’s

26

issue, and a four-week advertisement in the Sacramento Bee.

27

at 7.)

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support and a dedicated class action website where class members

(Settlement Agreement at 2.)

(Pls.’

Because defendant does not have records showing who

(Id. at 14; Settlement Agreement Ex. D, Settlement
KCC will place month-long

(Id.

Further, KCC will provide ongoing toll-free telephone

13

1

can obtain additional information and fill out online claim

2

forms.

3

14.)

4

(Settlement Agreement Ex. D, Settlement Notice Plan at

The notice explains the proceedings; defines the scope

5

of the class; informs the class member of the claim form

6

requirement and the binding effect of the class action; describes

7

the procedure for opting out and objecting; provides the time and

8

date of the fairness hearing; and directs interested parties to

9

more detailed information on the settlement website.

(Settlement

10

Agreement Ex. E, Proposed Notice.)

11

class members may recover for the purchase of up to ten bottles

12

per household without providing proof of purchase and can recover

13

for more than ten bottles if they submit adequate proof of a

14

greater number of purchases along with their claim forms.

15

The content of the notice therefore satisfies Rule 23(c)(2)(B).

16

See Fed. R. Civ. P. 23(c)(2)(B); see also Churchill Vill., L.L.C.

17

v. Gen. Elec., 361 F.3d 566, 575 (9th Cir. 2004) (“Notice is

18

satisfactory if it ‘generally describes the terms of the

19

settlement in sufficient detail to alert those with adverse

20

viewpoints to investigate and to come forward and be heard.’”

21

(quoting Mendoza v. Tucson Sch. Dist. No. 1, 623 F.2d 1338, 1352

22

(9th Cir. 1980)).

23

The notice makes clear that

(Id.)

The court is also satisfied with the claim form, which

24

allows each class member to specify his or her total number of

25

bottles purchased of each eligible TRESemmé Naturals product.

26

(Settlement Agreement Ex. F, Claim Form at 2 (Docket No. 57-2).)

27

Further, the claim form specifies the deadline for submission and

28

clarifies that completion of the form is necessary for receipt of
14

1

payment.

2

(Id. at 1.)
Given that there is no record of potential class

3

members and that KCC is experienced in providing similar notice

4

plans in consumer class action settlements, the court is

5

satisfied that this system is reasonably calculated to provide

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notice to class members and is the best form of notice available

7

under the circumstances as required under Rule 23(c)(2).

8

B. Preliminary Settlement Approval

9

After determining that the proposed class satisfies the

10

requirements of Rule 23, the court must determine whether the

11

terms of the parties’ settlement appear fair, adequate, and

12

reasonable.

13

1026.

14

factors,” including:

15
16
17
18
19

See Fed. R. Civ. P. 23(e)(2); Hanlon, 150 F.3d at

This process requires the court to “balance a number of

the strength of the plaintiff’s case; the risk,
expense, complexity, and likely duration of further
litigation; the risk of maintaining class action
status throughout the trial; the amount offered in
settlement; the extent of discovery completed and the
stage of the proceedings; the experience and views of
counsel; the presence of a governmental participant;
and the reaction of the class members to the proposed
settlement.

20

Hanlon, 150 F.3d at 1026.

Many of these factors cannot be

21

considered until the final fairness hearing, so the court need

22

only conduct a preliminary review at this time to resolve any

23

“glaring deficiencies” in the settlement agreement before

24

authorizing notice to class members.

25

No. 2:08-567 WBS DAD, 2014 WL 3057506, at *12 (E.D. Cal. July 7,

26

2014) (citing Murillo, 266 F.R.D. at 478).

Ontiveros v. Zamora, Civ.

27

At the preliminary stage, “the court need only

28

‘determine whether the proposed settlement is within the range of
15

1

possible approval.’”

2

Gautreaux v. Pierce, 690 F.2d 616, 621 n.3 (7th Cir. 1982)).

3

This generally requires consideration of “whether the proposed

4

settlement discloses grounds to doubt its fairness or other

5

obvious deficiencies, such as unduly preferential treatment of

6

class representatives or segments of the class, or excessive

7

compensation of attorneys.”

8

Inc., Civ. No. 04-0438 WBS GGH, 2006 WL 1652598, at *11-12 (E.D.

9

Cal. June 13, 2006)).

Murillo, 266 F.R.D. at 479 (quoting

Id. (quoting W. v. Circle K Stores,

10

1. Negotiation of the Settlement Agreement

11

Courts often begin by examining the process that led to

12

the settlement’s terms to ensure that those terms are “the result

13

of vigorous, arms-length bargaining” and then turn to the

14

substantive terms of the agreement.

15

1652598, at *11-12; In re Tableware Antitrust Litig., 484 F.

16

Supp. 2d 1078, 1080 (N.D. Cal. 2007) (“[P]reliminary approval of

17

a settlement has both a procedural and a substantive

18

component.”).

19

reached the settlement after two years of litigation involving

20

“substantial discovery,” an “extensive and contentious mediation

21

process before a highly experienced and well-regarded mediator,”

22

and thorough motions practice.

23

¶ 15.); see La Fleur v. Med. Mgmt. Int’l, Inc., Civ. No. 5:13-

24

00398, 2014 WL 2967475, at *4 (N.D. Cal. June 25, 2014)

25

(“Settlements reached with the help of a mediator are likely non-

26

collusive.”).

27

accept the settlement agreement takes into account the

28

“significant risks” and delays associated with continuing

See, e.g., West, 2006 WL

Plaintiffs’ counsel states that the parties

(Pls.’ Mot. at 17.; Kindall Decl.

Plaintiffs’ counsel declares that his decision to

16

1

litigating.

2

(Kindall Decl. ¶¶ 18-19.)

In light of these considerations, the court finds no

3

reason to doubt the parties’ representations that the settlement

4

was the result of vigorous, arms-length bargaining.

5

2. Amount Recovered and Distribution

6

In determining whether a settlement agreement is

7

substantively fair to the class, the court must balance the value

8

of expected recovery against the value of the settlement offer.

9

See Tableware, 484 F. Supp. 2d at 1080.

This inquiry may involve

10

consideration of the uncertainty class members would face if the

11

case were litigated to trial.

12

*14.

See Ontiveros, 2014 WL 3057506, at

13

Here, the settlement achieved a “key goal” of the

14

litigation in that it resulted in the discontinuance of the

15

TRESemmé Naturals line of products.

16

the $3.25 million settlement fund is more than 25% of the “best

17

case” damages of $12.65 million, as calculated by plaintiffs.

18

(Pls.’ Mot. at 18.; Kindall Decl. ¶ 17.)

19

Further, as discussed above,

The court however notes that the settlement agreement

20

requires class members to take the affirmative step of opting in

21

to receive payment and opting out if they do not wish to be part

22

of the settlement class.

23

Class Action Settlement (“Notice”) at 2-4 (Docket No. 52-2).)

24

Class members who do not request to be excluded will release

25

defendant from any underlying claims.

26

there is a risk that some members of the class will opt into the

27

judgment by default, thus releasing defendant, despite receiving

28

no recovery simply because they fail to timely return the claim

(Settlement Agreement Ex. E, Notice of

17

(Id. at 3-4)

Therefore,

1

form.

2

While the settlement amount is on the low-end of the

3

expected recovery range and the agreement contains a potentially

4

unfair opt-in/opt-out requirement, there are many uncertainties

5

associated with pursuing litigation that justify this recovery.

6

Plaintiffs’ counsel contends that plaintiffs would have been

7

required to prove both that the TRESemmé Naturals labeling was

8

likely to deceive or confuse reasonable persons and that those

9

representations are material to reasonable persons.

(Kindall

10

Decl. ¶ 18.)

11

price premium that was directly related to the product being

12

“natural,” rather than because of some other characteristic of

13

the product, and quantifying this premium would have involved a

14

battle of the experts.

15

not prevail would likely have appealed the judgment.”

16

¶ 19.)

17

Further, establishing that all class members paid a

(Id.)

Finally, “[w]hichever party did
(Id. at

In light of the uncertainties associated with pursuing

18

litigation, the court will grant preliminary approval to the

19

settlement because it is within the range of possible approval.

20

Murillo, 266 F.R.D. at 479 (quoting Gautreaux v. Pierce, 690 F.2d

21

616, 621 n.3 (7th Cir. 1982)).

22

3. Attorney’s Fees

23

If a negotiated class action settlement includes an

24

award of attorney’s fees, that fee award must be evaluated in the

25

overall context of the settlement.

26

312 F.3d 1123, 1126 (9th Cir. 2002); Monterrubio, 291 F.R.D. at

27

455.

28

the award, like the settlement itself, is reasonable, even if the

Knisley v. Network Assocs.,

The court “ha[s] an independent obligation to ensure that

18

1

parties have already agreed to an amount.”

2

Headset Prods. Liab. Litig., 654 F.3d 935, 941 (9th Cir. 2011).

3

In re Bluetooth

The settlement agreement provides that plaintiffs’

4

counsel will apply to the court for a fee award of up to 30% of

5

the gross settlement amount, or $975,000.

6

¶ 56.)

7

(Id. ¶ 15.)

8

for the fee award so long as it does not exceed 30%.

9

If the court does not approve the fee award in whole or in part,

(Settlement Agreement

Attorney’s fees are to be paid from the settlement fund.
Defendant agrees not to oppose plaintiffs’ petition
(Id. ¶ 56.)

10

it will not prevent the settlement agreement from becoming

11

effective or be grounds for termination.

12

(Id. ¶ 58.)

In deciding the attorney’s fees motion, the court will

13

have the opportunity to assess whether the requested fee award is

14

reasonable by multiplying a reasonable hourly rate by the number

15

of hours counsel reasonably expended.

16

Mut. Life. Co., 214 F.3d 1041, 1045 (9th Cir. 2000).

17

this lodestar calculation, the court may take into account

18

factors such as the “degree of success” or “results obtained” by

19

plaintiffs’ counsel.

20

879 F.2d 481, 488 (9th Cir. 1988).

21

the fees motion, finds that the amount of the settlement warrants

22

a fee award at a rate lower than what plaintiffs’ counsel

23

requests, then it will reduce the award accordingly.

24

will therefore not evaluate the fee award at length here in

25

considering whether the settlement is adequate.

26

See Van Gerwen v. Gurantee
As part of

See Cunningham v. County of Los Angeles,
If the court, in ruling on

The court

IT IS THEREFORE ORDERED that plaintiffs’ motion for

27

preliminary certification of a conditional settlement class and

28

preliminary approval of the class action settlement be, and the
19

1

same hereby is, GRANTED.

2

IT IS FURTHER ORDERED THAT:

3

(1) The claims administrator shall notify class members

4

of the settlement in the manner specified within the Settlement

5

Notice Plan;

6

(2) Class members who want to receive a settlement

7

payment under the settlement agreement must accurately complete

8

and submit the online claim form or deliver the claim form to the

9

claims administrator no later than September 19, 2016;

10

(3) Class members who want to object to the settlement

11

agreement must either deliver written objections to the Clerk of

12

Court for the Eastern District of California, the law firm of

13

Izard, Kindall & Raabe, LLP, and the law firm of Kirkland & Ellis

14

LLP postmarked no later than September 19, 2016 or appear in

15

person at the final fairness hearing.

16

the objecting person’s full name, current address, telephone

17

number, signature, a statement that the class member purchased

18

one of the products, all objections and reasons for the

19

objections, and any supporting papers.

20

submits an objection remains eligible to submit a claim form and

21

receive monetary compensation;

22

The objection must include

Any class member who

(4) Class members who fail to object to the settlement

23

agreement in the manner specified above shall be deemed to have

24

waived their right to object to the settlement agreement and any

25

of its terms;

26

(5) Class members who want to be excluded from the

27

settlement must submit the request for exclusion to the claims

28

administrator no later than September 19, 2016.
20

Class members

1

who opt out shall not receive any settlement proceeds or be bound

2

by any of the terms of the settlement, including the release

3

provisions;

4
5
6
7
8
9
10
11
12
13
14
15

(6) The following TRESemmé Naturals Settlement Class is
provisionally certified:
All individuals in the United States who purchased the
following TRESemmé Naturals products: (a) Nourishing
Moisture Shampoo; (b) Nourishing Moisture Conditioner;
(c)
Radiant
Volume
Shampoo;
(d)
Radiant
Volume
Conditioner; (e) Vibrantly Smooth Shampoo; and (f)
Vibrantly
Smooth
Conditioner
(collectively,
the
“products”). Specifically excluded from the Class are
(1)
defendant,
(2)
the
officers,
directors,
or
employees of defendant and their immediate family
members, (3) any entity in which defendant has a
controlling
interest,
(4)
any
affiliate,
legal
representative, heir, or assign of defendant, (5) all
federal court judges who have presided over this action
and their immediate family members, (6) all persons who
submit a valid request for exclusion from the class,
and (7) those who purchased the products for the
purpose of resale.
(7) Plaintiffs Alba Morales, Lanie Cohen, Linda

16

Clayman, and Kenneth Drew are conditionally certified as the

17

class representatives to implement the parties’ settlement in

18

accordance with the settlement agreement.

19

Kindall & Raabe, LLP, through Mark Kindall, is conditionally

20

appointed as class counsel.

21

Mahler & Birkhaeuser, LLP, through Alan Plutzik and Michael

22

Strimling, is conditionally appointed as liaison counsel.

23

Plaintiffs and counsel must fairly and adequately protect the

24

class’s interests;

25
26
27
28

The law firm of Izard,

The law firm of Bramson, Plutzik,

(8) The parties agree that KCC will serve as the claims
administrator;
(9) If the settlement agreement terminates for any
reason, the following will occur: (a) class certification will be
21

1

automatically vacated; (b) plaintiffs will stop functioning as

2

class representatives; and (c) this action will revert to its

3

previous status in all respects as it existed immediately before

4

the parties executed the settlement agreement;

5

(10) All discovery and pretrial proceedings and

6

deadlines are stayed and suspended until further notice from the

7

court, except for such actions as are necessary to implement the

8

settlement agreement and this Order;

9

(11) The final fairness hearing is set for October 17,

10

2016 at 1:30 p.m., in Courtroom No. 5, to determine whether the

11

settlement agreement should be finally approved as fair,

12

reasonable, and adequate;

13
14

(12) The following are the certain associated dates in
this settlement:

15
16

(a) The claims administrator shall publish notice
pursuant to the notice plan by August 11, 2016;

17
18

(b) Class members shall file objections, requests
for exclusion, and claim forms by September 19, 2016;

19
20

(c) Plaintiffs shall file a motion for attorney’s
fees no later than September 12, 2016;

21

(13) The parties shall file briefs in support of the

22

final approval of the settlement no later than September 12,

23

2016.

24

Dated:

July 11, 2016

25
26
27
28
22